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My Language School Is In Trouble – What Should I Do?

Last updated: May 12, 2021

The quick answer

The first thing you should do is work out if your language school is insolvent. This means either all your assets will not cover all your liabilities in full or you are unable to pay your debts as they fall due.

If you are insolvent then you should not continue to take deposits for language courses in advance. 

In more detail

Course fees

If your language school is insolvent then you may not be able to afford to continue. In these circumstances you should not take fees for courses in advance unless the funds are put into a protected separate client account – so they are not mixed into general funds or used to pay off an overdraft.

This is an issue even if students are paying by credit card or debit card.


You should also work out what assets the school has and the likely liabilities and if this means there is a shortfall you should seek the advice of a Licensed Insolvency Practitioner like us.

One cost you need to also consider is the redundancy cost of staff if you can not continue.  Schools typically have well paid, long serving employees and this can be more expensive than you think.


One option may be to put the language school into liquidation. This triggers the UK Government Redundancy Fund to pay out employees. You can always buy the school assets and re-start the school at a later date. 

More questions in this section

Author: David Kirk - ACA FABRP
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Just a quick email to say a heartfelt thank you for your very calm, considered, expert advice regarding my circumstances on Tuesday. Things looked bleak before you explained my options much more clearly, in simple layman’s terms.
Rob Elliott (14th December 2021)



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David Kirk

Licensed Insolvency Practitioner